Apache Corp. loses $7.2 billion for quarter, slashes capital spending

Houston’s Apache Corp. reported a net loss of $7.2 billion for the fourth quarter as it took $5.9 billion in charges to write down the value of assets.

The independent oil and gas company will slash its planned capital spending for this year and expects to see a year-over-year production decline of 7 percent to 11 percent.

Apache expects to spend $1.4 billion to $1.8 billion, a reduction of more than 60 percent from last year and down more than 80 percent from 2014.

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It will focus on “high rate-of-return opportunities” in Egypt and the North Sea as well as “key strategic testing” in North American onshore properties.

“Apache enjoys several advantages in the current low-price environment including a strong financial position, a relatively low base production decline rate, a lean cost structure, and a disciplined capital-spending program,” CEO John Christmann said in a statement. “We have a portfolio of high-quality assets with robust inventory in North America, higher-cash-margin assets in Egypt and the North Sea and exciting longer-term exploration prospects.”

For the fourth quarter of 2015, Apache lost $19.07 a diluted share and reported $1.3 billion in revenue. Apache lost $4.8 billion, or $12.78 a share, for the same quarter a year earlier. It reported $2.7 billion in revenue then.

Christmann stressed that the company has “significantly” improved its liquidity and financial position over the course of last year.

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“We reacted quickly to the lower price environment by dramatically reducing our activity levels and taking decisive steps to attack our overhead, operating and capital costs,” he said. “Our operational focus during the year was on strategically delineating our core acreage positions and conducting key exploratory tests to position for future growth and optimal returns when the investment environment improves.”

Apache’s stock was down 3 percent in late morning trading.